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Compensation and Motivation

February 03, 2016

I enjoy putting together contests and incentives that motivate people. When I was Director of Retail at Bose most of them were well received, and people loved the themes and activities.

Well, except once. I ran a themed contest that I thought was pretty good, but it fell flat on its face. It had zero impact on the business. Nada. Nothing.

I started poking around to see what went wrong. The feedback was pretty unanimous. The store's staff found the contest kind of boring and the prizes were insufficient, especially as compared to the previous contest, which had been a home run.

I remember meeting with my boss and complaining how unappreciative the store employees were. Maybe the contest wasn't as exciting as the previous one, but it was still better than nothing. I mean, come on people! It’s free stuff to do your job.

What he told me next has stuck with me ever since. He explained that every time I did something new and different for the staff, I created a new level of expectation. Maybe I didn't like it, but he said it is human nature that we reset our expectations based on our life experiences.

He used this example.

Say you're used to staying in a Motel 6. It's okay, but not great. But once you start staying in a Marriott Courtyard, the Motel 6 is no longer okay. It's a step down. The Marriott Courtyard is perfectly fine – until you stay at the Ritz. Now the Courtyard is no longer as nice as it was before because you have new and higher expectations. You will probably stay at the Courtyard again, but it's definitely not the Ritz.

He went on to say that as a leader I had to keep executing at a higher level in order to meet and (we hope) exceed the staff's new level of expectations. That if I was asking more of the staff, I had to first ask more of myself. I had to be better.

Even if I couldn't always increase the level of prizes, I could make the incentives and contests more engaging and fun than the previous one. If I wanted higher results, I had to create an even better employee experience.

Think about this as some of you are running a Valentine’s Day contest, or working on an incentive for a spring launch. Many of your employees have been through those before. Your role as a leader is to make everything you launch for your staff even better than before.

Here’s the bottom line. Your staff will always have new levels of expectations, and if you're going to be successful you have to rise above them to inspire and motivate them accordingly. It’s not that they aren’t appreciative. It just means you’ve done your job so well they now expect more. You just need to do it again.

So let me ask, what will you do to make your next initiative or incentive even more successful? If you want higher results than last year, YOU have to execute even better than before.

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About Doug Fleener

Doug Fleener, a proven business and customer service experience expert and speaker/consultant, helps companies achieve performance that exceeds customer and employee expectations resulting in more sales, profits, and customers.

Learn more about our services at Sixth Star Consulting, or call Doug at 866-535-6331 to discuss how he can help you achieve higher levels of performance and results. Learn about Doug's keynotes and workshops at DougFleener.com.

February 05, 2014

Years ago I had an incredibly talented retail associate working for me. He was smart, charming, a fast learner, and one of the best salespeople I ever met. There was, unfortunately, one major problem: he was lazy. He did only enough to get by.

I spent an incredible amount of time and energy trying to motivate him. I could sometimes get a one or two day bump in his performance, but he invariably slid back into mediocrity. It drove me crazy.

What I didn't understand at the time is that the ability to motivate others is a myth. I know that sounds like leadership blasphemy, and it's a statement I would once have scoffed at, but I'm convinced you can't motivate the unmotivated.

Motivation is the desire or willingness of someone to do something. The desire to work with customers has to come from within. The willingness to proactively engage and sell customers has to be something a person likes and wants to do. You can't successfully motivate people to do something if they just don't want to do it. They have to want to do something, and they have to enjoy doing it.

But wait. Doesn't money motivate people? A study by Edward Deci, a psychologist at Rochester University, found that students offered cash prizes to solve puzzles were less likely to continue working on them after payments had been made, compared to students who were offered no money.

Deci's work helped clarify the relationship between intrinsic and extrinsic motivation - doing things because you like doing them in their own right or doing them because you want a reward that has been offered. This is why hiring the right person is so important.

Offering a motivated person more money could result in higher performance, but it will have little or no effect on the unmotivated. I've said for years that if you pay more to a mediocre employee, all you have is a more highly paid mediocre employee.

Instead of trying to motivate people, I believe the key is to inspire the motivated and remove the unmotivated. Here’s how.

1. Make work fun. As many of you know, one of my favorite sayings is, "You can't ask people to give service with a smile until you give them something to smile about." That pretty much says it all. The best leaders I've worked for and with have the ability to make each day a great experience for their team.

2. Make each day challenging. I like to compare working retail to the movie Groundhog Day. Every day can be the same day over and over - if we allow it to be. That's why good leaders challenge their employees to try new things, and to strive to improve something they were maybe not so terrific at the day before.

3. Constant and consistent staff development. Motivated people want to learn. They want to grow. Many of them want career opportunities. This is one of the most important parts of a leader’s job, but unfortunately it doesn't happen nearly enough in retail. A development plan doesn't have to be complicated, but it does need to be constant and consistent.

4. Regularly recognize each individual's effort and performance. Never underestimate the importance of specific recognition. People want to contribute to a store's success, and they especially appreciate it when their effort is called out. Recognition makes an even bigger impact when it's put in writing.

5. Create a strong sense of team. Good teams bring out the best in each member, provide mutual support, and bring more purpose to each person's work. A group of people isn't a team. A group of people committed to a common cause and enabling each other's success, is.

6. Opportunities to earn more and win prizes. Short-term contests, games, and incentives are a great way to inspire motivated people. It can also be wasted effort with the unmotivated. It's as important to focus on and reward the right behaviors as it is to achieve the desired results.

7. Empower and simplify. You can tell an employee how special he is, or how much you appreciate her, but they're not really feeling the love and respect if they have to get a manager every time to complete a small refund or other simple activity. Give people ownership. Show you trust them. Make their work easy. Of course you have to have checks and balances in there, but I'd rather have an inspired and empowered team than spend time worrying about a fraudulent $10 refund. But that's just how I think…..

8. Have well defined standards and expectations, with the appropriate accountability. One of the fastest ways to demotivate a motivated employee is to not hold everyone accountable for the expected standards and expectations. Most people will rise to what's expected of them, but they'll also lower themselves to the level of accountability set for others.

9. A voice. Motivated employees want to contribute and be a part of the future. They have good ideas and would like to share them. They feel inspired when they can bring ideas up with their manager and their manager's manager or the owner, and potentially see that idea successfully put into practice.

10. Remove the unmotivated. An unmotivated person who doesn’t meet the acceptable level of performance drags the entire team down. Motivated employees resent it when the management team accepts and even enables poor performance. Moving underperformers up or out will actually inspire motivated employees, and improve the customer experience and results.

So let me ask, how much energy are you wasting trying to motivate the unmotivated? More important, are you putting enough energy and focus on inspiring the motivated?

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Doug Fleener, a proven retail and customer experience expert and consultant, helps companies dramatically improve their customer experience and their results. Visit the Dynamic Experiences Group website, or call Doug at 866-535-6331 to discuss how he can help you create extraordinary results.

January 25, 2012

We all know that finding and retaining great people is a vital element for any experience-based store or company. What might not be as obvious is how much harder it is to work and succeed in our stores. It's a heck of a lot harder to engage than clerk, or to maximize a sales opportunity instead of transact it.

Who better to help us find the people who can do this than the people who are already doing it? True, most retailers have some type of current employee referral program, but most of them are ineffective. How do you make them more effective? Here are some things to consider.

1. Substantially increase the amount of your referral bonus. Make the payout such a WOW amount that most of your employees are always recruiting. Forget $100 or $250 payouts...go BIG!

Here's an idea. What if you paid a $1,000, $1,500, or higher referral bonus for every new sales associate? Before you hit send on the email telling me I'm crazy, think about the cost of an open position or high turnover. And how much more can a really good employee sell versus an average one? This program will easily pay for itself.

2. Change the way you pay out. Most companies only pay a bonus after the new employee makes it past their probationary period. I think employees need more instant gratification.

With a $1,000 bonus, I would pay the employee who made the referral $250 on the referred employee's first day. I would pay another $250 if the new hire is still there after 90 days.

Here's the big change I would make. If the referred employee is still with the company after one year, the referring employee gets a $500 bonus! That is motivation to not only find good people, but to help them be successful in their job.

3. Keep championing your program. It's vital that your referral program remains front and center to your team. It takes more than a poster or annual announcement to keep the program viable. The key is to publicize every payout. Make it a big deal...because it is.

Here's a twist on finding and creating a great team.

4. Pay managers to develop new managers. This is a concept Chipotle uses. They pay a developmental bonus of $10,000 for managers who bring an employee up through the ranks into management. The manager gets $5,000 when the person gets promoted, and another $5,000 after the employee has been in the position for six months.

Check out the result. This focus on developing staff and promoting from within has had a significant impact on Chipotle's turnover at the management level. For salaried managers, turnover dropped from 52% to 35%, and entry-level hourly managers went from 111% to 47%! Sounds like that bonus is also paying for itself.

So let me ask, are you leveraging your staff to help you find and retain great people?

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Doug Fleener is a proven retail and customer experience expert that helps companies dramatically improve their customer experience and their results. Visit our website or call Doug at 866-535-6331 to discuss how he can help you create an extraordinary experience and results.

January 05, 2011

In most companies every employee is eligible for an annual merit raise. Usually the owner or manager goes through some strange process that has nothing to do with either merit or performance but always ends up at an increase of base pay between 3% and 5%. It makes you wonder if someone is spinning some Wheel of Compensation that only has numbers between three and five on it.

I remember one year meeting with an employee who recommended that all her managers be given a raise of, yes, you guessed it, somewhere between 3% and 5%. This included two managers that she had had problems with all year.

When I asked why she was recommending that under-performers receive a merit increase she told me that everyone expects a merit increase.

I reached for my dictionary and looked up the word "merit."

Merit: something that deserves or justifies a reward or commendation; a commendable quality, act, etc.

Did these two employees deserve a raise? No. Did their efforts and performance justify being paid more money? No. And why were we giving these two employees a raise? It wasn't because the employees were expecting it, although they were. It was because the manager didn't want to deal with the fallout of not giving someone a raise when they expected one.

Universities talk about grade inflation. This is pay inflation. Pay an under-performing employee more money and all you have is a wealthier under-performing employee.

Merit increases need to be based on past performance. Period.

This also means that your best people deserve a larger share of the available increases than do the others. Oh wait, we can't do that because it might upset people! But isn't that the same excuse that has us paying under-performing employees when we shouldn't?

Even worse, we can't give top-performer Barbara Bucks a large annual increase because she'll be making more than long time average-performer Sandy Standsaround. Now that so-called reasoning makes me want to pull out my hair!

Top performers deserve larger raises than do average performers. If, over time, that adds up to being paid more than other employees, so be it.

Average performers need to be paid more than poor performers, especially since you should be moving poor performers out. Or as my client and friend Todd says, "Promote them to customer."

It's not easy to pay on true merit rather than giving everyone an annual increase, but that's what good leaders do.

It's never easy to tell an employee they're not getting a raise, but that's what good leaders do.

It's really hard to tell an employee they're not getting a raise if you've not had any of those difficult one-to-one conversations. Do the right thing and you'll get those conversations started, and next year the employee can get one of the larger raises!

So let me ask, how will you decide merit increases in 2011?

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Doug Fleener is a proven retail and customer experience expert that helps companies to improve their on-floor and management performance. Vist our website or call me at 866-535-6331 to discuss improving your company's experience and results.